Greece’s Economic Crisis and the Future of the Eurozone

Greece failed to make a €1.6 billion payment due to the International Monetary Fund yesterday, making it the first developed country in the world to default to the IMF. The Greek government had asked for a postponement of the payment to permit the country to conduct a referendum on a series of austerity measures demanded by its creditors to extend repayment. After European Union negotiators refused, it was not clear how Greece would respond.

This morning, Greek Prime Minister Alexis Tsipras said the country would “conditionally accept” most proposed austerity measures, but he also indicated that the national referendum on the measures would proceed to a vote on July 5 as scheduled. If voters reject the austerity measures, as Tsipras has campaigned for them to do, Greece’s future in the Eurozone would be cast into doubt.

What do you think? Should the Greek government accept the austerity measures demanded by the International Monetary Fund and the European Union in exchange for the loan restructuring it desires? Should Greece consider exiting the Eurozone? And what would the impacts of an exit be both for Greece and for the European Union more generally?

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